Which of the given options best describes the truthfulness of the following statements? Statement-1: Under Self Balancing Ledger system each ledger is prepared under double entry system and a complete trial balance can also be prepared by taking up the balances of ledger accounts. Statement-2: Under Self Balancing Ledger system three ledger accounts are prepared, viz. General Ledger Adjustment Account, which is maintained under Debtors Ledger and Creditors Ledger and Debtors or Sales Ledger Adjustment Account and Creditors or Purchase Ledger Adjustments Accounts, which are maintained under General Ledger.
Both statement-1 and statement-2 are correct.
The correct answer is option 3. Both statements are correct. Statement-1 accurately describes that the Self Balancing Ledger system uses a double-entry system and that a trial balance can be prepared by taking the balances of ledger accounts. Statement-2 is also correct as it describes the three ledger accounts prepared under this system: General Ledger Adjustment Account, Debtors or Sales Ledger Adjustment Account, and Creditors or Purchase Ledger Adjustment Account. These are maintained separately under the General Ledger.
Important Questions from Self Balancing Ledger System
Which of the following statements is INCORRECT in relation to Self-Balancing Ledger system?
Self-balancing entries will only be made for those transactions which affect ______.
Which one of the following entry will be passed for ‘credit sales’ under self balancing ledger system?
Which of the following is/are INCORRECT match(es) of the account maintained in the context of self-balancing ledgers?
(i) Bought ledger adjustment account - Total creditors account
(ii) Sales ledger adjustment account - Total debtors account
Which of the following is an INCORRECT pair, in the context of the Adjustment Account given in General Ledger under self-balancing ledger system?
